CEO Sharon Price John says Build-A-Bear’s old e-commerce system is a big reason for disappointing online sales in December.
The web-only wellness products retailer plans to invest in fulfillment and international growth.
Online-only health and wellness products retailer Vitacost.com Inc. reported double-digit sales gains for the fourth quarter of 2012 and the full year, and projected an increased focus on fulfillment efficiency and international sales in 2013.
For the year ended Dec. 31, 2012, Vitacost, No. 86 in the Internet Retailer Top 500 Guide, reported:
- Total sales of $330.7 million, a 26.9% increase compared with $260.5 million in 2011. Proprietary product sales accounted for 22% of total 2012 sales, versus 23% in 2011.
- Reported net loss was $19.2 million, a 29.7% increase from $14.8 million.
- The number of shipped orders on Vitacost.com and the Amazon.com Inc. marketplace was 4.9 million, a 36.6% increase over approximately 3.6 million.
- The company ended the year with 1.7 million active customers on Vitacost.com, up more than 30% from about 1.3 million in 2011. Including its business on Amazon, the merchant had 2.1 million total active customers.
The growth in active customers and number of shipped orders stemmed from a greater emphasis on new customer acquisition, as the merchant expanded marketing activities, promotional offers and its affiliate network, according to Vitacost’s annual report filed with the U.S. Securities and Exchange Commission. The company also began selling products on the Amazon.com Inc. marketplace in the second half of 2011, which, the merchant says, boosted growth significantly in 2012. Vitacost did not provide any further details on its Amazon sales.
In 2013, Vitacost plans to place a greater emphasis on international sales, working to enhance the shopping and delivery experience for international customers, and raise awareness of where the e-retailer ships. Sales to international customers represented 6% of total sales in 2012, compared with 4% and 3% in 2011 and 2010, respectively. Canada, Hong Kong, Japan, Taiwan and the United Kingdom were the main sources of global orders.
Vitacost is also focused on improving customer satisfaction by processing orders in a timely fashion, according to its annual filing. During 2012, the retailer increased storage capacity of its two fulfillment centers to hold up to 50,000 SKUs. This year, the merchant is upgrading its warehouse management systems and modifying its order processing methodology.
"During 2012, we continued to execute on our initiative to grow our customer base," says CEO Jeffrey Horowitz. "We also continue to expand our product offerings with the addition of over 5,000 net SKUs during the year. As we move into 2013, we remain focused on expanding our customer base and improving the efficiency of our operations."
For the fourth quarter, Vitacost also reported:
- Sales of $85.0 million, a 26.1% increase compared with $67.4 million in the fourth quarter of 2011.
- Reported net loss was $3.2 million, flat compared with 4Q 2011.